[lbo-talk] Fitch and Brenner

[SA]

That's true, but these figures represent the actual dollar amounts spent 
on real investment. We are led to believe that finance has somehow 
drained the resources available for undertaking real investment 
spending. These data show it hasn't. The higher depreciation rates 
nowadays are significant only to the extent that the more rapid wearing 
out of of the capital stock was retarding productivity growth. But it's 
not, as I tried to show with these data:

	nonfarm business productivity
1950s 	2.1%
1960s 	2.7%
1970s 	1.7%
1980s 	1.6%
1990s 	2.0%
2000-07 	2.4%

	MFG productivity growth
1950's 	2.8%
1960's 	3.3%
1970's 	2.3%
1980's 	3.7%
1990's 	4.6%
2000-2007 	3.6%

michael perelman wrote:
>
> The problem with your data is the trend toward spending less on 
> long-lived plant and equipment & more on software and IT equipment 
> with a short life span.  So, the economy needs more investment just to 
> stay up to where it was earlier.
>
> SA wrote:
>
>> As for whether capital was shifted out of production, the proof is in 
>> the pudding. Here are the numbers I got for private fixed 
>> non-residential investment as a share of GDP:
>>
>>
>>     Inv/GDP
>> 1930s     6.5%
>> 1940s     6.7%
>> 1950s     9.4%
>> 1960s     9.8%
>> 1970s     11.1%
>> 1980s     12.1%
>> 1990s     10.9%
>> 2000-2007     10.7%
>>
>>
>
>